Neiman Marcus 2010 Annual Report Download - page 43

Table of Contents
Contractual Obligations and Commitments
The following table summarizes our estimated significant contractual cash obligations at July 30, 2011:
Payments Due By Period
(in thousands) Total
Fiscal
Year
2012
Fiscal
Years
2013-2014
Fiscal
Years
2015-2016
Fiscal Year
2017 and
Beyond
Contractual obligations:
Senior Secured Term Loan Facility (1) $ 2,060,000 $ — $ — $ — $ 2,060,000
Senior Subordinated Notes 500,000 — — 500,000 —
2028 Debentures 125,000 — — — 125,000
Interest requirements (2) 1,169,500 158,600 318,000 321,100 371,800
Lease obligations 863,000 57,200 109,500 93,700 602,600
Minimum pension funding obligation (3) 66,600 — 41,500 24,000 1,100
Other long-term liabilities (4) 74,200 6,000 13,300 14,300 40,600
Construction and purchase commitments (5) 1,170,900 1,164,100 6,800 — —
$ 6,029,200 $ 1,385,900 $ 489,100 $ 953,100 $ 3,201,100
(1) The above table does not reflect future excess cash flow prepayments, if any, that may be required under the Senior Secured
Term Loan Facility.
(2) The cash obligations for interest requirements reflect 1) interest requirements on our fixed-rate debt obligations at their
contractual rates and 2) interest requirements on floating rate debt obligations at rates in effect at July 30, 2011 (including the impact,
if any, of our current interest rate cap agreements). Borrowings pursuant to the Senior Secured Term Loan Facility bear interest at
floating rates, primarily based on LIBOR, but in no event less than a floor rate of 1.25%, plus applicable margins. As a consequence
of the LIBOR floor rate, we estimate that a 1% increase in LIBOR would not significantly impact our annual interest requirements
during fiscal year 2012.
(3) At July 30, 2011 (the most recent measurement date), our actuarially calculated projected benefit obligation for our Pension
Plan was $475.1 million and the fair value of the assets was $376.4 million resulting in a net liability of $98.7 million which is
included in other long-term liabilities at July 30, 2011. Our policy is to fund the Pension Plan at or above the minimum amount
required by law. We made voluntary contributions to our Pension Plan of $30.0 million in each of fiscal years 2011 and 2010. As of
July 30, 2011, we do not believe we will be required to make contributions to the Pension Plan for fiscal year 2012.
(4) Included in other long-term liabilities at July 30, 2011 are our liabilities for our SERP and Postretirement Plans aggregating
$109.5 million. Our scheduled obligations with respect to our SERP and Postretirement Plan liabilities consist of expected benefit
payments through 2021, as currently estimated using information provided by our actuaries. Also included in other long-term
liabilities at July 30, 2011 are our liabilities related to 1) uncertain tax positions (including related accruals for interest and penalties)
of $10.3 million and 2) other obligations aggregating $24.2 million, primarily for employee benefits. Future cash obligations related
to these liabilities are not currently estimable.
(5) Construction commitments relate primarily to obligations pursuant to contracts for the construction of new stores and the
renovation of existing stores expected as of July 30, 2011. These amounts represent the gross construction costs and exclude
developer contributions of approximately $16.4 million, which we expect to receive pursuant to the terms of the construction
contracts.
In the normal course of our business, we issue purchase orders to vendors/suppliers for merchandise. Our purchase orders
are not unconditional commitments but, rather represent executory contracts requiring performance by the vendors/suppliers,
including the delivery of the merchandise prior to a specified cancellation date and the compliance with product specifications, quality
standards and other requirements. In the event of the vendor's failure to meet the agreed upon terms and conditions, we may cancel
the order.
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